MFE-Mediaforeurope N.V. (T0J1.F) Earnings Call Transcript & Summary

Good day, and thank you for standing by. Welcome to the MFE-Mediaforeurope Conference Call and Webcast. [Operator Instructions] Please be advised that today's conference is being recorded. I would now like to hand the conference over to your first speaker today, Sara Bersan. Please go ahead.

Good morning, ladies and gentlemen, and welcome to the presentation of MFE-Mediaforeurope unlock value MFE Equity story with ProSiebenSat.1. Today, the speakers are Marco Giordani, Group CFO; Matteo Cardani, Chief Marketing Officer of MFE Advertising; and Paola Colombo, Chief Digital Officer of MFE Advertising. Marco, please go ahead.

Thank you, Sara. Welcome to everybody. We thought it was useful for everyone, let's say, to recap a little bit what happened in the last 6 months. It has been really, let's say, moving around and with a lot of news coming out on the newspaper. And so we thought it was useful for everyone to give a summary of where we stand and where we are going to. I'll take you through the first part of the presentation, starting from Page 2. Again, nothing new for many of you, but I mean, that's today's situation. As you know, today is the settlement date. And so we are exchanging, let's say, our share and our cash flow with ProSieben shares. And so the famous 75.61% is today in place. And clearly, that's the representation. The cash [Technical Difficulty].

Please continue to standby. Your conference will resume shortly.

Okay. We can restart the presentation. Apologize for the problem.

Sorry, and welcome back. I will start the presentation from the beginning. Clearly, there may be some of you, maybe it's been a repetition, but I mean, that's fine. Page 2, as I said, today is the settlement date. And so these are the final number. Our stake in ProSiebenSat.1 is already known 75.61%. The cash out today has been EUR 437.7 million and the numbers of newly issued MFE-A shares has been 127 million point something. Moving to Page 3. We tried to give you a sort of representation of what the pro forma consolidation would have been in 2024. You have a little bit of notes in the foot page. Clearly, it's a theoretical exercise. I mean, the 2024, let's say, unaudited pro forma figures was the one that are shown in Page 3. So total revenue a little bit less than EUR 7 billion, precisely EUR 6.9 billion. Reported EBITDA pre-TV rights, EUR 2.322 billion; and after TV rights, a little bit more than EUR 1 billion. As far as the net debt is concerned, already including also the cash out, the net debt would have been EUR 2.5 billion. And so the leverage a little bit more than 1x. Again, that a sort of, let's say, consolidated 2024 number. But as I said, it's very difficult for us to be more precise than that because we clearly took the ProSieben public numbers that we don't know a lot so we couldn't make it better. As far as the MFE shareholder structure, you have it at Page 4. Clearly, there is -- there are 2 pies. The economic interest are shown on the left part of the slide with a free float of more than 43%. Fininvest holding 33.8%, Vivendi directly 3% through the trust -- adding the trust a little bit more than 15% and PPF is today holding 6.8%. As far as voting rights is concerned, on the other hand, you have on the right-hand side of the page, Fininvest controls 47.5% of MFE vote; the market, 28.4%; PPF, 1.7%; and the addition or let's say, the combination between Simon Fiduciaria and Vivendi, a little bit more than 22%. Numbers of shares divided by category are shown in the table at the bottom of the page. On Page 5, something that some of you have already seen is our, let's say, future strategic vision. Clearly, not a lot different from the past, but clearly, the fact that now we control 75% of ProSieben is clearly giving a lot of power to our vision, giving us the possibility to target more than 200 million viewers/users. Starting from content, clearly, we consider ourselves firstly, a publisher. So we clearly, let's say, focus on the quality of our content in terms of reputation, truthful and respect for pluralism and diversity and privacy content. The main objective of the content we produce is the emotional engagement at scale also because we think that this is where we can play a difference versus the big streamers, let's call it in this way. And another important element of the content we are going to produce are the local rooted and clearly focus on entertainment and infotainment for both large events, the one that clearly collect a lot of audience and also for everyday consumption and community. As far as the second pillar of our vision, monetization is crucial. Paola and Matteo will take you through the main point why we think we can really go to a level that we -- that was not achievable in the past. And we think that, that will be the major advantage of our future vision. Technology, it's another focus point. We think that joining forces and increasing scale, it's crucial to have better technology, more efficient technology, but mainly more performing technology. We cannot think, let's say, to be better than the big streamer, but at least we can be at scale and we can be at the state-of-the-art being certainly much better than we were before. And lastly, clearly, that's a little bit an open point on which, on the other hand, we think we are going to face and we are going to, let's say, exploit a lot in the next months and years is artificial intelligence that will help us to mainly produce more volume. So to increase volume and to have the monetization, but that will be crucial for the future and the fact of being larger and in more than one country will be of a great benefit for all the group. On Page 6, that's a slide we -- you have already seen. I mean, it's just the same. As you remember, when we increased our offering late July, we showed 3 possible outcomes for different, let's say, results coming out from the offer. We are clearly in the scenario #2 and the numbers of, let's say, improvement of our EBIT in terms of incremental EBIT is in a range of EUR 261 million - EUR 315 million at year 4. Clearly, the other scenario for the time being are not applicable. Entering in a major detail in the scenario 2, you have on Page 7, the split between cost and revenue and the split in the forthcoming year, starting from 1st of January 2025. And then entering in cost because revenue will be then presented by Paola and Matteo. You have Page 8 that gives you a little bit of a representation of the scope of the challenges we are facing. We started from 2024 combined cost, the one that we were mentioning in some slides before. We clearly took away the noncash cost, and we had a EUR 6.5 billion total cash cost and investment. We took away EUR 2.5 billion that is out of scope means that is not the core business activity we are going to target in the future, and we arrived to a total addressable cost baseline of EUR 4 billion. And our cost initiative, as you can see in the slide, represents approximately 4% of the addressable cost baseline. On Page 9, on the other hand, you have, let's say, the result of the exercise we carried out divided in the 6 buckets in which we allocated all the projects we had identified. And as you can see, it's a pretty detailed analysis. It's important to underline that the cost initiative, in any case, would represent around 2% of the total combined cost. So for us, it's an hard work to carry out, but certainly it's not a non-achievable target to have. On the other hand, we will have top line-driven initiatives that are now presented by my colleagues to which I will pass the presentation.

Thank you, Marco. Thank you, and good morning, everybody. So we are now on Chart #11. And in this chart, you have a conceptual representation of the strategic map of our market with 2 main axis or dimension, reach on the [indiscernible] axis and quality and brand safety on the horizontal axis where you can see our actual and our future desired positioning. We do strongly believe that in the new total video ecosystem, Mediaforeurope should and could break the trade-off for advertising, providing reach on the one hand and brand safety and targeting at the same time. This is absolutely relevant for advertisers and agencies because in the current market scenario, advertisers suffers from an asymmetry. Either they face global players that are disproportionately bigger compared to each advertiser scale. And therefore, to some extent, advertiser -- these players may have some limitation with regard to the offering of customized solution to each advertiser country by country. Or advertisers, they face national champions, national broadcasters that are actually smaller compared to the scale of their ambition. And therefore, advertisers are obliged to search for consistency and scale for their multinational project. So we do believe that the uniqueness of Mediaforeurope ambition and Mediaforeurope challenge is to solve these products offering at the same time, reach at scale, quality of content, brand safety and advance targeting via data and ad tech. In the following chart #12, you have a material supporting evidence of this reach at scale. What does it mean that we offer unrivalled reach scale in the quality competition versus over-the-top? In this chart, you can appreciate the fact that we do not think about ourselves as a broadcaster anymore, but we do define ourselves as a stream caster that means competing with over-the-top through the best combination of linear legacy and on-demand development, and this is a unique combination. What's the benefit for the market of this unique combination? Here, you have the actual calculation if we consider the new geography, the new perimeter of Mediaforeurope advertising. We are in countries with 200 million population, and we actually reached 190 million inhabitants, citizens in all these countries. So 95% of reach, editorial reach and advertising reach. Then we calculated. You can see the sources of the calculation in the footnote in the chart. The combined, the duplicated reach of 3 very important and absolutely respected competitors, Amazon, Netflix and Disney, they reach in the same countries, 98 million people, so approximately 49%, and only 60 million of citizens with advertising, so 30% of reach. This is the scale of the competition when we talk about reach. But just to give you -- to mention 2 recent combined successes in Italy and Spain. This summer, we broadcasted and streamed FIFA World Cup for Club, an agreement with DAZN, and we reached more than 51 million people in the 2 countries, Italy and Spain. That means 1 Italian out of 2, 1 Spanish out of 2. And on top of this, the absolute capability to deliver unbelievable reach and engagement on own content, what we call the crown jewels is The Last Temptation -- last edition, sorry, of Temptation Island in the 2 countries, where we reached 35 million people in the 2 countries, so 1/3 of the total population. So this is the material evidence of reach and scale. And in the following chart, #13, the other side -- the other main benefit, we are a streamcaster, but we are also a cross-media company. So benefit for the advertiser is that they actually miss a one-stop shop for cross-media strategies at international scale. In this chart, there is a clear representation that on top of quantity reach and scale, we are offering diversity of cross-media solution covering the whole range of relevant media for an advertiser, offering a simplified coordinated solution to complex communication problems across the country. So we are in a regional multi-local and multinational approach in our go-to-market, as Paola will soon explain.

Thank you, Matteo. So starting from Slide 14. Why do we believe that it will be creating value? Because if you look at from the standpoint of the market, we're adding value at different segments of our clients effectively. So if we get into the shoes of local advertisers, so here, we took Conad and Dio, which are 2 big retailers. So their business is entirely in one country, in Italy or in Spain. So from their standpoint, they will keep having the same strong relationships we've had so far, but they will be seeing enhanced product development, faster go-to-market, which will be provided by the international synergies that we will have. Then if we move that we have a significant already contribution from local advertisers, take Campari, PUIG for Spain, Lavazza, we could have many more that are rooted locally. So we have very, very strong relationships starting decades ago with them. And they have businesses that are trading worldwide. So they have exports in Europe and some of them in the rest of the world. So in this case, they will be able to leverage their existing relationship, not only in the country, but for their export business, and we will be more of a business partner in their international expansion. Then we have global to local advertisers, take the L'Oréal, the Coca-Cola of the world. So if I look from their standpoint, so they have been going through a centralization over time, and this is a bit of a chicken and egg point. So big online platforms have created an international market. So these are the headquarters that will be typically meet with your Google, with your Disney+, with your Netflix, and they will be starting allocated centralized budget. Furthermore, they have created centralized digital operations and planning and programmatic. So they have very few people managing their online budgets and business. So the fewer conversations they have, the better for them. In this case, we will step up from a local level to an international one. We will be entitled to seat at those table, be part of the international budget allocation, and we will provide them simplification in their media strategy abroad, giving also, as Matteo explained, an important alternative to video sharing platform on one hand and very premium content providers and platforms on the other, but with limited reach. The same works also for media agencies. You know very well they're going through consolidation, centralization, a strong redesign of their business where they are centralizing a lot of their control and spending. So again, they will have a pan-European player, which -- with whom they can have trading deals and conversation. And on the other hand, they will also be able to centralize operation, reduce costs with having less complexity to deal with. So there is the need for an entity like Mediaforeurope advertising, and that's why providing value will be creating value for our company as well. Now if I move to Slide 15. So here, we are planning to set up. You can follow here. So here we have the 8 initiatives that we will be creating top line synergies, and we look at them from the very first ones, which are the closest to our business that we can immediately bring to market. And they are, in a way, a natural extension of what we are currently doing, but in a different context. And then moving to the right, we will see the more explorative one, the newer one and probably they are more midterm and longer-term impact. So as I said, international sales is like from a day 1 initiative. So leveraging know-how and relationship in all the markets, we will start immediately expanding that addressable as tech. Technology is just an enabler, but it is an important one if you're also playing -- if we're planning to play in this competitive scenario against international platforms. So here, we have started already with our Spanish colleagues, so creating a single platform that allows us to roll out products immediately in more than one country and streamlining operations and reducing those costs of development, management and so on. Then we -- Matteo mentioned some power brands, some loved brands that are very locally rooted, but they are the same. They have similarities across markets. So from there, we can put the seed for a branded entertainment powerhouse. Branded entertainment, branded content is one of the rising stars in the market. It has been for a few years now. So we will be able to leverage that as well as streamcaster cross country. We can also leverage our sales house capabilities and relationship as an asset because a lot of the OTTs, we mentioned they have an international footprint. But if they want to play in the market, they need to have the local know-how, the local flavor. And this is something that we can offer them as value, and we can be their sales out in this market. So see the example of DAZN in Italy or in the past, we did it for Yahoo! as well. Then there are business that are adjacent to our current one, but they still look like a natural expansion. So the one that we launched already and we'll be launching in Spain beginning of next year, it's a platform opening a new share of the market, which is a platform dedicated to small, medium businesses, which we launched here, we will be able to expand in more markets, and it's attracting new money to TV. So with that, it's absolutely easy to replicate in a centralized fashion to more markets. Retail Media, it's another rising star. So we have initiatives already in the different markets, both Italy, Spain and Germany too. So that will be unified and created. So this is a big trend. The U.S. is a few years ahead from where we are in Europe, but we believe this will be growing in coming years. And moving ahead, so all these that we have quoted as competitors, they can become source of business and great business partners for certain angles. So for sure, we can start having different deals with them. We can play with content licensing. We can have different windowing of content rights or, for example, we can co-produce with them. So this is where the lines start to blur, and we can see business opportunity in these new markets in new year. And then we can look also at scaling our crown jewel. So our strongest brand content. So they are loved brands in countries so they can travel, they can be replicated in more markets. And also thanks to technology, think of the AI translation that doesn't require human dubbing anymore, we can distribute them across country and have them travel in countries that we are not present with, think South America or other countries in the world. So coming to Slide 16 to give you a bit of -- to attach some numbers to all the initiatives we have mentioned. So you can see that the first 4 initiatives, they would contribute from EUR 86 million to EUR 96 million in EBIT synergies. The SMB platform and retail media, so the addition business, they could add to EUR 28 million to EUR 30 million to the bottom line. And going to content strategy, B2B and B2C that we've mentioned further EUR 17 million to EUR 18 million, totaling altogether an impact on EBIT from EUR 131 million to EUR 144 million.

Thank you, Matteo, and thank you, Paola. Our presentation is, let's say, ending, and I want to focus your attention on our new equity story from today on. Clearly, we are now focusing on different targets than we were, let's say, 6 months ago. That's a new start for us, and I believe it's important to recap where we are targeting our company. Again, we think that we can now leverage a larger scale with the presence of 5 European countries for the time being and more than 200 million viewers/users. We certainly have substantial value initiatives that we can unlock, especially across tech and monetization. I hope that we have given to you a little bit of the flavor of what we are targeting. We think that our equity story is now future-proof in the sense that we have the resources to reinvest in more local premium content using next-gen technologies. That's clearly something we were not able to see 6 months ago. We think to be sustainable, so we can leverage our trusted media ecosystem. We are fully aligned with EU value of pluralism and we have a sustainability goals. We have a story now that is talent oriented. We have projects that can attract talent. We can talk about growth and not only managing maturity. And we think that, that will be crucial to attract and retain key employees and talent. And we think to be fit and proper in the sense that we have already tested some of the technology we are talking about, and we think that will be not very challenging to leverage on them. Local operation will be crucial, but certainly, driving seat will stay more at the group level for everything regarding tech and data. In terms of value, we think to have a pretty exciting story and pretty exciting objective to achieve, as we said, up to EUR 315 million of EBIT -- of incremental EBIT in year 4. That's incredible accretion in terms of EPS for MFE shareholders, and that's already from year 1 that is going to be 2026. In terms of financials, I think you know already our way of doing. So we will certainly accelerate deleveraging also because the cash flow generation will be materially high. We didn't change our commitment as far as dividend policy is concerned. And so our pretty high payout will go on. We are going to generate cash mainly to reduce debt and to pay dividends. All the long-term shareholders will have a pretty substantial value creation. And we have now created a pretty large liquidity on MFEA stock that was one of our main concern in the past. And now we think that trading volumes is now more in line with also the equity story we are telling about. That's all from our side. I think we have now time for your questions. And so we can start with the Q&A session. Thank you.

[Operator Instructions] And your first question comes from the line of Julien Roch from Barclays.

I'll be greedy. I actually ask 4 questions. The first one is on Page 7, can you explain the range of synergies, the EUR 261 million to EUR 315 million in year 4? I know you gave an exact split on Page 9 and Page 10, but why a range? I mean, if you had to put a probability on the bottom, the middle and the top of the range, that's my first question. The second one is, can you give the phasing of the cost to achieve of EUR 80 million to EUR 110 million, how much in '25, in '26, in '27? The third question is, Marco, you just said that priority was deleveraging, but that you would continue your high payout ratio. But I suppose that's the payout ratio on MFE. The speed of deleveraging, which is now both the MFE and ProSieben debt also depends on the ProSieben dividend policy. So what will be the ProSieben dividend policy going forward? And last question is coming back on when you bought Mediaset España in 2022, you said you would deliver EUR 55 million of synergies, EUR 21 million revenue, EUR 34 million cost. How much have you actually delivered?

Thank you, Julien. I hope to have noted all of them. So I'll start to answer. If I forget something, please let me know. I mean probably I will not follow the order. I mean, in terms of one-off costs, you have it on Page 7. They are between EUR 80 million and EUR 110 million. And now let me say about why the range. I have to say that on the full integrated scenario, the range is almost irrelevant, while in the non-fully integrated scenario, we have problem of timing. So all the projects are pretty defined, and we are pretty conscious and pretty rational on how we can deliver. Clearly, having to deal with a listed company, ProSieben, we have issue regarding related party transaction. And clearly, we have to take care about all the shareholders, not only the MFE one, and that will clearly create some delays on which, frankly, we don't have a clear view on in the sense that we will start talking with Executive Board, ProSieben Executive Board, and timing of all the projects has to be redefined, taking in consideration the fact that we will need to act in the best interest of all shareholders, including the ProSieben, plus the 25% ProSieben shareholders. As far as the dividend policy -- ProSieben dividend policy, I mean, hard to say now. ProSieben has its own dividend policy. I mean, as you know, looking at the numbers, the biggest part of the debt will be in ProSieben. So I mean, as far as the deleverage is concerned, our main objective is to deleverage ProSieben first. So I mean, then we can probably talk about their dividend policy, one that the leverage in ProSieben will come back to, let's say, a more MFE standard one, let's say, let's put it in this way. But as I said at the beginning, we have no access to any information regarding ProSieben that you don't have. So we don't know anything that you don't know, and it is hard for us, let's say, to give a precise guidance on the deleverage of ProSieben for the sale. I hope that in the coming months, that will be more accessible for us, and we can be more precise on that. I have the impression that I forgot one. On Spain, yes. No, in reality, we outperformed the target in the sense that cost was easier to achieve and faster to achieve, and we get more or less 25% higher in cost. And I don't know if you want to talk about revenue, but also in revenue, actually, we achieved much better results than we forecasted. I mean, Matteo, maybe you -- okay. He's just saying that that's enough. In any case, we got it faster and more. Honestly, we were a little bit prudent in declaring our objective, but the reality was better. It's more a question of governance, I have to say. Clearly, Spain was a fully integrated company. It was much easier. But in any case, the value to unlock it important and also for the remaining ProSieben shareholders will be important to work on the project and to unlock that value.

If I could come back on the -- sorry, on my first 2 questions. So I mean, EUR 261 million to EUR 315 million in synergies. I mean, if you had to handicap the bottom, the middle and the top of the range, I mean, are you more confident about the top, the bottom or you have no idea? And then the phasing of the EUR 80 million to EUR 110 million cost to achieve, I mean, how much in '25, in '26 and '27?

I will use the average because it's the best estimate we can give. As I said, as soon as we can start talking with management, we can be more precise. But as far as today is concerned, I believe that the average in all the numbers are the more reliable numbers. We can update it in the coming, let's say, months.

And on the phasing of the EUR 80 million to EUR 110 million?

The same. So the -- I mean, the EUR 80 million and the EUR 110 million, you mean the one-off in 3 years...

The cost to achieve the phasing in '25, '26 and '27?

'25, clearly nothing. I mean we are all talking about '26 on, and you can split the EUR 80 million, EUR 110 million in 3 years in a pretty, let's say, linear way.

Your next question comes from the line of Adam Berlin from UBS.

I have 2 questions left. My first question is, can you talk a little bit about how the -- it will work with the ProSieben Executive Board? Are you going to have Board seats? How many Board seats, what percentage of the Board seats? Just to understand how you're going to influence ProSieben's strategy? Do you need a domination agreement? What are you thinking around that? So any kind of clarity around that would be very helpful. And second thing is ProSieben do have non-broadcast assets in dating and in e-commerce in particular. Do you plan to retain those assets? Or are you looking to sell them?

Okay. So let's start maybe a little bit recapping the governance in ProSieben. Clearly, they are -- ProSieben is listed there and adopted a dual system in terms of governance. So actually, the Executive Board is elected or nominated by the Supervisory Board. So we don't have any direct access. We being shareholders. We don't have direct access to the Executive Board, but we -- as a shareholder, we can only nominee the Supervisory Board member. So in practical terms, that's clearly a structure where the Supervisory Board will play an important role also in the, let's say, in the assessing and in delivering the project that, as we have seen, will grant additional value to MFE, but also to ProSieben shareholders. And so clearly, the settlement date. So today, it's an important formal date for us, but also for the Supervisory Board. So for instance, we are expecting and we are waiting to see whether maybe some Supervisory Board member could resign or not. I mean the shareholder structure has changed. So maybe some of them will decide to step down. We don't know. But I mean, we'll see. We will wait some days to see whether this decision will be taken. Clearly, if no decision will be taken in that respect, we have the formal instrument to, let's say, to adapt, to change and to manage Supervisory Board, and we will use it in case nothing happen. As soon as the Supervisory Board will be, let's say, a clear picture of the present shareholder structure. At that point, we will start, let's say, engaging the Supervisory Board with working group and we're also showing to the Supervisory Board where we think the value can be executed, can be achieved and also maybe with some also commercial proposal in order to put in place. I make an example, clearly, MFP advertising is already acting in the interest of ProSieben selling some of their, let's say, audiences and whatever that, for instance, a commercial agreement can be enlarged. That's an example. We will certainly look at the technology to see whether -- I mean, we are sure, but I mean, where we can get the synergies and the advantages in a larger scale and in a faster way. So a clear example is, are we going to use the Italian and Spanish streaming platform or the joint platform. That's a pretty, let's say, objective decision to take. We don't care, frankly. The cheaper and the more efficient and effective it is, the better it is for everyone. No one will choose a platform because of the technology as soon as the technology is state-of-the-art. So I think that's another pretty easy goal to achieve. And all the projects in that respect will be put on the table, working room will be set up. And then as I said before, formality before the execution will be certainly to be applied in terms of be sure that we are acting in the best interest of all shareholders, so the MFE and the ProSieben. So that's the process we are going to tackle, I believe, in the next couple of weeks. And that's also the reason for which we are not expecting anything before 2026. As far as the core and noncore assets, I think, we were pretty clear already a long time ago. We think that we are a publisher. We think that we need to focus all our resources on media. We don't think we have money to invest somewhere else. I mean, if we have not used cash, it's better to rent them to shareholders. They can diversify by themselves. We don't think it's our objective to diversify. We need to make the media asset working. And clearly, you know and I already said that the ProSieben level is pretty high. So I think that -- and I hope because I don't know that some of the assets that today is considered noncore can be used to reduce debt. We need to reduce debt to invest in content. So noncore asset will be the main gasoline to put in the engine of the content and to reinforce the content power of ProSieben. Again, the portfolio of assets in ProSieben is pretty large. And sorry to repeat it, we don't have access to any of the information. So if you ask me what kind of assets you're going to sell, I simply don't know. But we will ask the Supervisory Board to conduct a pretty detailed analysis and assessment of any single asset that is not core to see whether it is better to dispose, to shut down, to merge. I mean, that's something that the Supervisory Board will put, in our opinion, as one of the first priority. I repeat it, we need the resources to invest in content. And on the other hand, we think that the complexity of running 3 different business as it is ProSieben today, it's also affecting a little bit the focus on the core business of the management because it's really a huge achievement to take care about companies that are running from Australia to U.S. and from different sectors, different technology. So I think that reducing the scope of activity, it's also happening -- helping the focus on media and also the result of the focus will be appreciated by all shareholders.

Your next question today comes from the line of Andrea Randone from Intermonte.

I have a couple of questions. The first one is a very easy one. I mean, when do you think you should start consolidating ProSieben? And the second one is about the full combination scenario. I mean you're clearly indicating you are now in the intermediate scenario, but I wonder if you can comment on -- I mean, on when you should -- you might trigger the full combination scenario and if this decision is in your hands in theory?

First answer, 1st of October 2025, so last quarter is the start of the line-by-line consolidation method. As far as other scenario, I mean, we also stated clearly in the CMO, we were targeting a larger influence on the company, not a full integration. Clearly, we were forced to launch a tender offer up to 100% because that's a low. And we are sticking with this scenario. We are not planning anything else for the next 16, 12 months. So we are now very focused on execute what I told you through the listed company and the, let's say, the entity that we can talk about and the Supervisory Board. That's where we stand. And no other news on that respect will come out in the next 6 to 12 months.

Your next question comes from the line of Jérôme Bodin from ODDO BHF.

So 3 of them. The first one in content production. So do you plan to create a common structure between MFE and ProSieben on production capabilities with [indiscernible] or will you remain fully local on that side? That's my first question. Second one, 2 quick follow-up on governance. So the first one is the so-called domination agreement is a likely scenario with ProSieben. And secondly, regarding the Board, so you answered on ProSieben, but I was wondering same question for MFE. Do you plan to change the Board of MFE by integrating German Board members? And lastly, a quick follow-up on the ProSieben noncore asset. I'm not sure if the cost synergies plan that you detailed include or not the noncore business of ProSieben like Flaconi and the dating business on the cost base.

Let's start from the content. The answer is no. So as you have seen in the split of the bucket, the content part is very small, almost immaterial, and it's not implying any content hub or content production hub or we think that there can be some sharing experience advantage that in any case, we didn't value. So we think that sharing experience and maybe sharing also best practice can help, but they are not included in the amount showed. We are not planning any domination agreement. Sorry, I forgot to say it before in the sense that we are not planning any different scenario in terms of controlling stake in the next 6 to 12 months. The domination agreement is certainly part of this non-foreseeable action we are going to undertake. As far as MFE Board is concerned, clearly, we have not -- we -- meaning MFE, we have no plan to do anything on that until the next renewal that is in 2027. Clearly, if shareholders are willing to change, it's their task and their rights, if you want. And so it's an answer, you should ask to them. But I mean, for the company. So as far as the company is concerned, we have no plan in that respect. And no synergies are expected from noncore assets. So as we explained in the presentation, we have excluded the cost base and the revenue base from our, let's say, synergy calculation. So we always refer only to the media business.

And your next question comes from the line of Inigo Egusquiza Castellanos from Kepler Cheuvreux.

Most of them have been already answered, but just 2 quick follow-ups from my side. The first one is just a clarification on the consolidation of ProSieben. I mean, the idea is to consolidate, obviously, globally as from 2026 and eliminating, I guess, the minorities. And for 2025, you mentioned that the idea is to consolidate 3 months from October. This is the first question. And the second one is a follow-up on the dividend policy of Mediaforeurope. You said that you are maintaining a stable policy, but could you please remind us what is the policy in terms of payout for the company?

So as far as the MFE dividend policy, we are confirming that not lower than 50% of the net profit. So that was and still is the dividend policy, the MFE dividend policy. As far as consolidation, in reality, we start from 1st of October. And clearly, we are going on in that respect also in 2026 will be a line-by-line 1% consolidation. Clearly, before the net profit, we will have the stripping out of the third-party results being profit or losses, clearly, we will see. So that's pretty straightforward. And did I forget something? Probably, no.

And your next question comes from the line of Milo Silvestre from Equita.

Two questions from my side. The first one concerns ProSieben top line, which is still suffering, both in terms of U.S. advertising and in terms of audience share. So here, I was wondering, I mean, the main levers that you have to stabilize this top line in the short to medium term. While the second one, if you can, let's say, provide some idea concerning the combined free cash flow when synergies will be at full regime.

I mean, 2 very difficult questions to answer in the sense that, as I said before, we don't have access to any specific information you don't have. And as you can see from the balance sheet, there are not a lot of them. We believe in what we did in Italy. So maybe Germany is different. But we think that the main focus will be brands. Brands meaning not only, let's say, producing the TV show. But the fact that we need, let's say, to take care about talent, we need to take care about engagement. We need to take care about promotion. That's something that frankly changed in the last 20 years. And we think that we can share experience. And as I said, we think that clearly it may be applied on different formats, different content, different time slot or whatever. But the curation that we are applying on content in Italy, I think, it's important as an example of what can be, let's say, the normal curation that a 2025 media company should apply on. Clearly, from outside, we were not so inclined to follow, for instance, ProSieben in saying that they will focus all the effort on Joyn, on the streaming. We don't think there are different, let's say, strategy for different platforms. We need to produce the better content, the premium content at, let's say, the maximum level, then the distribution decision, it's important, it's crucial, but it's in any case, not the priority. So we will focus on content and less on distribution because we think that's the only way we can stay alive in terms of profitability. The streaming world is difficult. It's dominated by giants. Frankly, we are going to be larger than in the past, but probably our size will not be sufficient to compete on, let's say, on the same level. We need to find our part of the market. And we think that focusing on local content and curate our brands in the best way and to manage engagement will be our main objective in all the countries we are going to operate. As I said, for the time being, having no access to any kind of information, frankly, a more precise answer cannot be granted. Same for cash flow because -- we don't know detailed cash flow coming from ProSieben apart from the one that is disclosed in the official accounts. And frankly, we are not in a condition to tell you more because, for instance, I'll tell you something we don't know and you don't know as well. We don't know the net free cash flow of the different divisions. So we don't know how much is the net free cash flow of entertainment of dating and NuCom. So that's clearly our information without which it's very hard to answer to your question. In any case, as soon as we will have access to them, we can guide the information.

We have one further question. And the question is a follow-up from Julien Roch from Barclays.

Yes, it's me again. It's such a great call. I have many more questions. So if nobody resigns on the ProSieben Supervisory Board and you can't exert your control as fast as you'd like, would you consider calling an AGM to change the Board? Or will you wait for the AGM next May? That's my first question. Marco, you confirm -- yes, you want to answer?

No, no, yes, otherwise, I will forget it. You have several questions, so it's better to answer one by one. I'm sure Supervisory Board member will be sufficiently professional to take action. But in pure theoretical case, so if nothing happens, we will not wait until the next AGM. But as I said, I think that will not happen.

Okay. The second one is, you reminded us that the dividend policy is 50% of net profit and you will continue to do so. But the new profit is going to be much higher because the deal is very accretive. So are you telling us that the dividend is going to go up a lot, like 30%, 40%, 50%? Or will you do 50% on Italy and Spain only so you can deliver faster?

Yes, I mean, we are confirming the dividend policy. You know also in the past, as far as MFE is concerned, I mean, we need to have a solid balance sheet structure. So frankly, today, deleverage, it's a crucial deleverage at ProSieben level and clearly also at the consolidated level, it's an important factor. And as I said, we need to invest in content as well. So the dividend policy will stay, but clearly, let's say, investment will be evaluated. So once that all the synergy will be achieved, then clearly, we will see where we will be in the sense that it's a little bit too far away. But dividend policy today is not different. We will provide our shareholders with the same dividend policy as we were having before, even if the profit will go up.

Okay. So it is 50% of the reported net income, including synergies, just to be sure.

Yes. That's the point. If there are no other M&A, I mean, clearly, next year will be that one. Then clearly, the more you go forward, if the other acquisition will be other investment to carry out, I mean, we will certainly update. Leverage will be important as well. Are we going to sell the noncore assets or not? Dating, what is going to happen? So there are many elements, but the dividend policy is confirmed. And so clearly, all the synergy will be distributed if not needed for any other strategic investments.

Okay. And lastly, you told us that nothing will happen in the next 6 to 12 months in terms of like domination agreement, delisting, things like that. But you actually can buy ProSieben on the market without telling us as you don't have any disclosure threshold above 75% and without paying a premium. And ProSieben has gone down a lot, so it's cheap again. And the more you own, the more you control, the easier it is to delist. So are you considering buying ProSieben share on the market?

Is it a suggestion or -- no, no, that's a joke. No, that's -- so -- Clearly, we did the offer. I mean, now it's over. But I mean, the value of the offer, it's 9.4 today. So the shareholders that didn't tender, I mean they are playing a different kind of scenario that I don't know. But it's true. I mean, from the formal point of view, we have no communication obligation, if you want. We can buy on the market at any price. But I mean, as I said, for the time being, we have no plan for that. But you are right. Formally speaking, we can buy on the market at the price we want.

Okay. Thank you very much, Marco, Matteo and Paola, and thank you, guys, for the time today. Investor Relations department will be available for any questions you may have.

Thank you. This concludes today's conference call. Thank you for participating. You may now disconnect.